How to start Leveraged Margin Trading on BitMEX?

BitMEX is a popular peer-to-peer trading platform that specializes in leveraged contracts bought and sold using cryptocurrency. It offers a wide range of features and tools to facilitate efficient trading in the crypto market. Here’s a comprehensive overview of BitMEX and its key functionalities.

BitMEX exclusively handles cryptocurrency transactions and does not support fiat currency. This means that all trades are conducted using various cryptocurrencies available on the platform.

One of the standout features of BitMEX is its ability to facilitate high leverage trading. Traders can utilize leverage to amplify their trading positions and potentially generate higher profits. However, it’s important to note that higher leverage also exposes traders to increased risks and potential losses.

Trade Crypto with BitMEX

Navigation Tabs on BitMEX

BitMEX offers a user-friendly interface with five main navigation tabs, each serving a specific purpose:

Trade:

This tab serves as the trading dashboard, allowing users to select the instrument they wish to trade, choose leverage, place and cancel orders, view contract details, and monitor position information.

Account:

Here, users can access all their account information, including available margin balances, deposit and withdrawal details, trade history, and affiliate information.

Contracts:

This tab provides essential information related to trading instruments. Users can access funding history, minimum contract sizes, leverage options, expiry dates, underlying reference price index data, settlement history, and other pages relevant to traders.

References:

This section serves as an educational resource, offering valuable information about futures contracts, perpetual contracts, index calculations, position marking, liquidation processes, BitMEX fees, customer support, and other informative materials to enhance users’ understanding of the platform.

API:

The API tab provides users with detailed information on developing and maintaining an API connection with BitMEX. It covers the fully featured REST API and powerful streaming WebSocket API.

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Getting Started on BitMEX

For newcomers to BitMEX, it’s crucial to familiarize yourself with the References tab, where you can find educational materials and terms.

The Exchange Guide is particularly helpful in understanding order placement and profit and loss (PNL) calculations.

We recommend you to visit BitMEX’s Official Website and read the following guides in detail:

• Perpetual Contracts Guide: This guide focuses on the popular XBTUSD product, which is a perpetual contract. It explains important concepts such as the mechanics of perpetual contracts, market dynamics, and funding.
• Futures Guide: This guide provides insights into futures contracts offered by BitMEX, explaining the mechanics of futures markets, including basis.
• Auto Deleveraging: This page outlines the process of auto deleveraging, which occurs when a trader’s position cannot be liquidated in the current market. It is important to understand how this mechanism can impact positions.
• Fair Price Marking: Understanding fair price marking is essential, especially for leveraged trading. This page explains how positions are marked, affecting liquidation prices.
• Liquidation: This page provides insights into the liquidation process, which is crucial for all traders to grasp.
• Risk Limits: This page outlines the risk limits imposed on trading, determining the amount of leverage allowed for specific position sizes.

Go to BitMEX Official Website

Trading Overview on BitMEX

Trading on BitMEX may differ from other platforms due to the unique products and trading types available. It’s important to understand the margin terminology used on BitMEX and familiarize yourself with the order types supported by the platform.

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BitMEX Contracts

BitMEX offers two main types of contracts: perpetual contracts and futures contracts.

Perpetual Contracts:

These contracts do not have an expiry date and do not undergo settlement. They have a funding rate that occurs every 8 hours, where users holding positions either pay or receive funding based on market conditions.

Futures Contracts:

These contracts have specific expiry dates, and settlement occurs upon expiry. When a futures contract settles, all users holding positions are settled at the contract’s settlement price.

Both types of contracts allow traders to go long (buy) or short (sell) positions. BitMEX provides a valuable tool for shorting purposes, enabling users to sell contracts even if they don’t currently hold any.

Go to BitMEX Official Website

Margin Trading on BitMEX

BitMEX offers leverages of up to 100x on select products, allowing traders to control positions much larger than their available capital. For instance, with 1 Bitcoin, traders can access up to 100 Bitcoin worth of contracts. However, it’s important to exercise caution as high leverage not only accelerates potential profits but also magnifies potential losses.

BitMEX employs an auto deleveraging mechanism in rare cases where leveraged positions in profit may be reduced if a liquidated order cannot be executed in the market within a specific time period.

In conclusion, BitMEX provides a robust trading platform with high leverage options for cryptocurrency traders. Its user-friendly interface, comprehensive educational resources, and diverse contract offerings make it an attractive choice for both experienced and novice traders. However, it’s crucial for users to fully understand the mechanics of leveraged trading and risk management strategies to navigate the platform successfully.

Trade Crypto with BitMEX